Random thoughts. Not fit for general consumption. Parental advisory. Occasional sarcasm and irony ahead. No warranties, explicit or implied. No money-back-guarantee. Does not prevent hairloss, bad foot hygiene or acid reflux.

2011-05-23

Free investment tip.

Do you want an investment tip? If I had a few million dollars lying around I'd start looking for a startup aiming to write software to support the upcoming design, fabrication and manufacturing revolution. The sort of software you need to prototype, test, and yes, machine or 3D print physical objects.

Sure, there is already lots of software for this on the market, but it is extremely complex, expensive and most of it, if not all, is targeted at Windows. Makers don't use Windows. Makers use OSX or Linux. And it is the Makers you have to keep an eye on because they are the people defining what is right now a relatively small niche. Even if you ultimately will sell larger volumes on Windows (though I am not so sure you will).

The reason I think this is going to be a good area to invest is because the software houses in this industry are going to miss this market entirely. They are, after all, professionals with decades of experience and wouldn't even think of licensing even scaled down versions of their ultra expensive CAM software for calculating optimal toolpaths at prices affordable by mere hobbyists. Much less engage with them to externalize innovation and have mere users extend the ecosystem with their own extensions and tools.

As manufacturing becomes available to the masses (both in the shape of cheaper machines, but also in the shape of companies selling access to equipment through the net), in much the same way computers slowly became available to the masses in the late 70s, there will be a need for better, more user-friendly, more portable, and more extensible and adaptable software. Because that is the big hole in the ecosystem right now: the software. There are some cheap packages for doing rudimentary 3D design. There are also some packages to drive mills and 3D printers. But there is a very noticable absence of decent CAM packages to bridge the gap between those two worlds. That is: for the sort of audiences that are just now starting to enter the stage.

I predict that within the next 2 years a startup will emerge from the Bay Area that addresses this gap and makes an affordable CAM package that runs on something other than Windows. In 5-6 years the industry giants are going to be scratching their heads and asking themselves how on earth they could not have seen that coming -- and people will point out to them that history just keeps repeating itself. They will miss the market precisely because they think they know everything there is to know about their particular domain and they will be too heavily invested in the status quo to adapt. This happens in almost every industry from time to time.

There are also going to be a lot of innovation in the type of fabrication processes that are possible and practical. From advanced voxel machines to manufacturing living tissue. This is going to require flexibility and hackability.

So if you have a few million dollars lying around and you want to invest in something that may become a really exciting future market, I suggest you pack your bags, go to the Bay Area and start looking for startups that want to build affordable CAM-software. Of course, you'll have to be in it for the long haul, but I think there are fortunes to be made here.

Through sites like http://cloudfab.com/ you can already fabricate one-offs at relatively low costs. These types of companies will also be very important in helping you figure out what fabrication processes will be appropriate for you since this area is experiencing very rapid innovation. But you still have to provide them with decent designs and that requires proper tools. A package like SolidWorks is going to cost you something in the neighborhood of $4.000 to $5.000. It is a niche product for industrial use, though a bit overkill for the hobbyist. Of course, it is also quite obviously too expensive for the $50-$500 price range that a hobbyist might be able to pony up. Judging by the number of hobbyists I've encountered that seem to know SolidWorks and similar packages without having a job where they'd use it, I'd suspect that there are a lot of pirated installations of SolidWorks out there.

Oh and of course, SolidWorks is neither available on MacOS X, nor on Linux. Which is a big handicap even if Dassault Systèmes were to create a "Maker version".

If you want to go into the business of building these tools I wouldn't worry too much about being undercut by traditional players. By the time they catch on and slash prices they'll have nothing worthwhile to offer to the "amateur" segment anyway. They'll sit on the fence until it is too late.